EXHIBIT 10.26
SECOND AMENDMENT
TO
LOAN AND SECURITY AGREEMENT
THIS SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT, dated as
of the ___ day of December, 2003 (this "Second Amendment"), by and among UNITED
STATES LIME & MINERALS, INC., a Texas corporation ("U.S. Lime"), TEXAS LIME
COMPANY, a Texas corporation wholly owned by U.S. Lime ("TLC"), ARKANSAS LIME
COMPANY, an Arkansas corporation wholly owned by U.S. Lime ("ALC") (U.S. Lime,
TLC and ALC are collectively referred to as "Borrowers" and individually as a
"Borrower"), and NATIONAL CITY BANK ("Bank").
BACKGROUND
A. Borrowers and Bank are parties to a Loan and Security
Agreement dated as of February 28, 2003, as amended by the First Amendment to
Loan and Security Agreement dated as of August 5, 2003 (as amended, restated, or
otherwise modified and in effect from time to time, the "Loan Agreement")
pursuant to which Bank agreed, subject to the terms and conditions of the Loan
Agreement, to lend to Borrowers up to (i) Five Million Dollars ($5,000,000) on a
revolving loan basis, and (ii) Two Million Dollars ($2,000,000) on a
discretionary line of credit basis for equipment purchases, secured by
Borrowers' Accounts, Inventory, and related personal property, and the equipment
purchased with Advances. All initially capitalized terms used herein and not
otherwise defined herein shall have the same meanings ascribed to such terms in
the Loan Agreement.
B. Borrowers desire to increase the Maximum WC Line Amount from
$5,000,000 to $6,000,000 and have obtained the Additional Financing that is a
condition precedent to such increase. Borrowers and Bank desire to amend the
Loan Agreement to increase the Maximum WC Line Amount to $6,000,000 and to
extend the expiration of the WC Line Contract Period and the Equipment Line
Advance Period to April 1, 2005.
NOW, THEREFORE, in consideration of the foregoing and of the mutual
covenants set forth herein, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. Ratification. This Second Amendment is a modification of the
Loan Agreement pursuant to Section 18.11 thereof. Except as expressly set forth
herein, or in any amendment to any of the documents referred to herein,
Borrowers and Bank acknowledge and agree that each and every term, condition and
provision of the Loan Agreement is hereby ratified and confirmed in full.
2. Outstanding Indebtedness. Borrowers hereby unconditionally
acknowledge that, as of the date hereof, the outstanding principal balance of
the WC Line is $0, excluding an
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outstanding standby letter of credit in the face amount of $110,000, the
aggregate amount due on operating leases under the Equipment Line is
$975,526.61, and that such amounts, together with interest thereon at the rates
set forth therein, is owing to Bank without claim, counterclaim, recoupment,
defense or setoff of any kind.
3. Increase in Maximum WC Line Amount. Borrowers hereby request
that the Maximum WC Line Amount be increased to $6,000,000 and agree to execute
and deliver to Bank an Amended and Restated WC Line Note in the original
principal amount of $6,000,000 (the "Amended and Restated Line Note") together
with such other documents and instruments as Bank may require in order to effect
the increase. All references to "WC Line Note" in the Loan Documents shall
henceforth mean and refer to the Amended and Restated WC Line Note.
4. Extension of Equipment Line Advance Period. The definition of
Equipment Line Advance Period in Section 1.33 of the Loan Agreement is hereby
amended to delete the reference to "February 27, 2004" and replace it with
"April 1, 2005."
5. Extension of WC Line Contract Period. The definition of WC
Line Contract Period in Section 1.86 of the Loan Agreement is hereby amended to
delete the reference to "February 27, 2004" and replace it with "April 1, 2005."
6. Representations and Warranties. To induce Bank to approve the
modifications contemplated by this Second Amendment, Borrowers jointly and
severally represent and warrant to Bank as follows:
6.1 After giving effect to the modifications contained
herein, all representations, warranties and covenants made by Borrowers to Bank
in the Loan Agreement (except those relating to a specific date) are true and
correct in all material respects as of the date hereof, with the same force and
effect as though made as of the date hereof;
6.2 No Event of Default or Default has occurred and is
continuing under the Loan Agreement as of the date hereof, and neither the
execution, delivery nor performance of this Second Amendment or the Amended and
Restated WC Line Note would result in the occurrence of any Event of Default or
Default;
6.3 Each Borrower is a corporation validly subsisting
under the laws of the state of its incorporation; the execution, delivery and
performance of this Second Amendment and any other documents and instruments
executed and delivered by the Borrowers to Bank in connection herewith (i) are
within each Borrower's corporate powers, (ii) have been duly authorized by each
Borrower's Board of Directors, (iii) do not contravene any provision of law or
any indenture, agreement or undertaking to which any Borrower is a party or by
which it is otherwise bound, any Borrower's Articles of Incorporation or bylaws,
or any resolution of the Board of Directors of any Borrower, and (iv) require no
consent or approval of any governmental authority or any third party which has
not been obtained; and
6.4 In the case of each Borrower, this Second Amendment,
the Amended and Restated WC Line Note, and any other documents and instruments
executed and delivered by such Borrower to Bank in connection herewith have each
been validly executed by, and are enforceable against, such Borrower in
accordance with their respective terms.
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Any failure of any of the representations and warranties made by Borrowers in
this Second Amendment to be true and correct in all material respects when made
shall constitute an Event of Default under the Loan Agreement.
7. Conditions Precedent. The effectiveness of amendments to the
Loan Agreement and the consents set forth herein are subject to the satisfaction
of the following conditions precedent:
7.1 Borrowers shall have executed and delivered to Bank
the Amended and Restated WC Line Note; and
7.2 The Bank shall have received true, correct and
complete copies of resolutions of the Board of Directors of each Borrower
authorizing the execution, delivery and performance of this Second Amendment,
and the other documents and instruments executed and delivered by any Borrower
in connection herewith, including the Amended and Restated WC Line Note,
certified by such Borrower's Secretary as being true and complete copies of the
originals thereof and remaining in full force and effect, not having been
modified or rescinded.
8. Miscellaneous.
8.1 Entire Agreement. The Loan Agreement, as amended by
this Second Amendment, and the other Loan Documents embody the entire agreement
and understanding among the Bank and Borrowers. The Loan Agreement, together
with this Second Amendment, and all documents executed and delivered in
connection herewith, supersede all prior agreements and understandings relating
to subject matter hereof. This Second Amendment together with the Loan
Agreement, and the documents executed and delivered in connection herewith,
shall be construed as one agreement, and in the event of any inconsistency, the
provisions of any promissory note evidencing a portion of the Indebtedness shall
control over the provisions of this Second Amendment.
8.2 Counterparts. This Second Amendment may be executed
in any number of counterparts and by different parties on separate counterparts,
each of which counterparts, when so executed and delivered, shall be deemed to
be an original and all of which counterparts, taken together, shall constitute
but one and the same instrument. This Second Amendment shall be effective upon
the execution and delivery of a counterpart hereof by each of the parties
hereto.
8.3 Captions. The captions or headings in this Second
Amendment are for convenience of reference only and in no way define, limit, or
circumscribe the scope or intent of any provision of this Second Amendment.
8.4 Successors and Assigns; Governing Law. This Second
Amendment shall be binding upon and inure to the benefit of the respective
parties hereto and their successors and assigns and shall be governed by, and
construed and enforced in accordance with, the internal laws of the Commonwealth
of Pennsylvania without regard to its principles of conflicts of laws.
8.5 Confession of Judgment. Borrowers ratify, confirm and
restate the warrants of attorney to confess judgment contained in the various
Loan Documents including,
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without limitation, those contained in the Amended and Restated WC Line Note and
the Equipment Line Note, and each and every other Loan Document containing any
warrant of attorney to confess judgment. Borrowers ratify and confirm their
understanding that by executing documents containing warrants of attorney to
confess judgment against them, they have waived and are again hereby waiving the
right to receive notice or opportunity to defend against the entry of a judgment
against them before the entry of such judgment. These waivers are knowingly,
voluntarily and intelligently made, with the intention of being legally bound
hereby.
IN WITNESS WHEREOF, intending to be legally bound hereby, the
undersigned have executed this Second Amendment as of the day and year first
written above.
UNITED STATES LIME & MINERALS, INC.,
as Borrower
By: __________________________________
Name: M. Xxxxxxx Xxxxx
Title: Vice President & CFO
TEXAS LIME COMPANY, as Borrower
By: __________________________________
Name: M. Xxxxxxx Xxxxx
Title: Vice President & CFO
ARKANSAS LIME COMPANY, as Borrower
By: __________________________________
Name: M. Xxxxxxx Xxxxx
Title: Vice President & CFO
NATIONAL CITY BANK, as Bank
By: __________________________________
Name: ____________________________
Title: ___________________________
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